Tag Archives: budget cuts

Eric Pickles: a response

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Copied from Local Government Chronicle online
13 December, 2012 | By Dan Drillsma-Milgrom

Those that listened to the Department for Communities & Local Government’s ministerial team give evidence to its equivalent select committee on Wednesday will have heard Eric Pickles make the bizarre claim that quoting from LGC is like “quoting from a Labour party press release”.

The thoughtlessness of this comment can be demonstrated by simply pointing out that just a month ago, Mr Pickles’ own department was happy to quote LGC’s research into council chief executives’ salary levels in a press release about ending chiefs’ “golden goodbyes”. We don’t necessarily agree with the policy but were happy for Mr Pickles’ department to quote from our research, just as we were happy for David Cameron to do so last year.

Still, mud can stick. So for the record, let me restate Local Government Chronicle’s editorial position.

LGC has absolutely no affiliation to or bias towards any political party. Our editorial position is that we act as a friend to the sector – albeit a critical one where necessary. Our objective is to report on policy issues that affect all councils and, where we can, to put forward the case for local government to be part of the solution to some of the social and economic issues that the country faces. To do this, our reporters speak regularly with senior council officers, civil servants and local and national politicians of all parties.

Mr Pickles’ comment on Wednesday came in response to a question about DCLG’s permanent secretary Sir Bob Kerslake being branded a ‘doom denier’ for dismissing the LGA’s predictions of a looming financial crisis. The actual “doom denier” label was coined by the organisation’s Liberal Democrat group while the original ‘graph of doom’ was created by Conservative-run Barnet LBC. It was the LGA’s Conservative chairman Sir Merrick Cockell who said that while “denying” the growing funding gap that local government is facing “may be convenient for some”, it is “not accurate to suggest the view is overly pessimistic”. It is hard to see how reporting on this issue is representing the Labour party’s viewpoint.

To be honest, with Labour having not released much policy on local government, LGC has not devoted an awful lot of coverage to the party recently. One exception was when we exclusively revealed Labour councillors’ anger at their party’s leadership for forcing peers to vote against plans to give councils greater flexibility to deal with council tax benefit reforms – again, hardly the stuff of central office press releases.

LGC has, however, been critical of the lack of support Mr Pickles and his department have shown for local government. Our lead story and leader article in this week’s issue give an example of why this is.

But at the select committee hearing, Mr Pickles himself gave an interesting insight into why there’s such anger within the sector towards him. The communities secretary was asked by MPs whether Greg Clark’s decentralisation report, published last week, had implicitly criticised his department by saying “it should come to a more settled but ambitious view of the role of local government and communities and neighbourhoods”. He replied that he had inherited a department that was “the voice of local government within government” and that had changed to being “the voice of the council tax payer, of the citizen inside local government services”.

It is quite right for Mr Pickles to act as the voice of the council tax payer – Mr Pickles’ predecessors would surely claim to have done likewise – but many officers and local politicians now feel that councils do not have an advocate within Whitehall. Mr Pickles’ comment seems to confirm that this is the case. Or at the very least, if there is one, it’s not him.

Incidentally, it’s worth pointing out that reports in the press this week that Ed Miliband and Ed Balls are planning to oppose George Osborne’s plans to raise benefits and tax credits at a below-inflation 1% have important implications for local government.

If spending on the NHS, schools and overseas aid is to be protected whilst overall spending is reduced, then a decision to also protect welfare expenditure implies extra cuts for other spending departments, local government included.

Councils will be unlikely to sit higher up the pecking order under a Labour administration.

Pickles attacks LGA’s crisis forecast

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Copied from Local Government Chronicle online
13 December, 2012 | By Kaye Wiggins

A response to the unwarranted attack on LGC’s editorial impartiality will be posted shortly

Communities secretary Eric Pickles has attacked the LGA’s prediction of a crisis in local government services, accusing the group of being “seduced by statistics” and arguing that cuts to councils’ funding have been “modest”.

Mr Pickles (left) told the communities and local government select committee that it was “utterly ludicrous” for the LGA to predict that councils could struggle in future to fund anything other than social care and waste services.

He made his comments after committee chair Clive Betts (Lab) quoted reports in LGC that Department for Communities & Local Government permanent secretary Sir Bob Kerslake had been branded a “doom denier” for rejecting the LGA’s gloomy projections.

“I think it’s utterly ludicrous”, he said. “The LGA have allowed themselves to be seduced by statistics and have got themselves into a Malthusian fantasy” – a reference to the eighteenth-century scholar Thomas Malthus who argued that population growth would outstrip food supply, leading to starvation.

Mr Pickles said: “I do not believe the modest change we’ve seen means the end of civilisation as we know it. Local government will continue and find more efficient ways of doing things. If they find it difficult to do…new people will come.”

Mr Pickles also told the committee that quoting from LGC was “like quoting from a Labour Party press release”. The phrase “doom denier” was in fact coined by the LGA’s Liberal Democrat group.

To read acting editor Dan Drillsma-Milgrom’s response to Eric Pickles’ comments, click here

Asked whether Greg Clark’s decentralisation report, published last week, had implicity criticised his department by saying “it should come to a more settled but ambitious view of the role of local government and communities and neighbourhoods, he said that he had inherited a department that was “the voice of local government within government” and that had changed to being “the voice of the council tax payer, of the citizen inside local government services”.

Council tax

Mr Pickles also used the hearing to insist that freezing council tax levels was “entirely voluntary”. This week, LGC reported that civil servants in Mr Pickles’ department had discussed delaying the local government finance settlement until after Christmas in order to impose a blanket council tax freeze. He added that the settlement would be announced next week.

Sacking chiefs

Mr Pickles was also asked by MPs about his plans to make it easier to dismiss council chief executives – and said the request to do this came from local government itself.

Asked whether he was worried about chiefs being unprotected against politically motivated dismissals, he said: “I just don’t think local government is like that any more.

“You’ve got to rely on the integrity of politicians to make sure the threat of removals is not used lightly”, he said, adding that the removal of a chief usually meant that the council “goes into virtual stasis for six months”.

He praised David White, chief executive of Norfolk CC, who had stood down with a payoff of “just £35,000”. This was a lot of money, he said, but a long way from the settlements of more than £100,000 that some chief executives had received.

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READERS’ COMMENTS (1)
philcoppard | 13-Dec-2012 4:28 pm
Eric Pickles has previous form with these ludicrous statements.
As previously identified, the man is a clown.

West Somerset to become ‘virtual authority’

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And so it begins. For those who think elected members should be culled, here’s the answer, just get rid of the council and give it to the private sector!

Copied from Local Government Chronicle online
6 December, 2012 | By Ruth Keeling

Minsters have persuaded a council branded ‘unviable’ not to pursue a merger with neighbours and instead becoming a “virtual authority” commissioning services from other providers.

West Somerset DC has rejected LGA advice to commence a boundary review following a meeting with local government minister Brandon Lewis during which he made it clear he believed the authority should continue as a sovereign democratic body.

According to West Somerset’s account of a meeting held last month between Mr Lewis and the council’s chief executive and leader, the ministers endorsed the LGA view that the authority was “not sustainable” in its current structure but insisted there was “no need to engage with the Boundary Commission on the subject of a merger” as advised by the LGA.

He also warned the authority that it should not expect the local government settlement due later this month to solve the council’s problems, the report states.

Mr Lewis was of the “firm belief that the council should be retained as a democratically elected and accountable unit of local government representing the people of West Somerset”, according to West Somerset papers published on Wednesday, a stance in direct contrast to an LGA report published last month which stated “the council is not viable as a unit of local democracy and governance over the long term”.

‘Virtual authority’

Following Mr Lewis’ advice that West Somerset work closely with neighbours and become a commissioning council, a business case is to be drawn up with neighbours to investigate how the council can commission from “other service providers whom would predominantly, but not exclusively, be neighbouring councils”.

Under the fledgling plan the council of 82 full time employees would reduce its workforce further and “only retain a small nucleus staff to manage the commissioning arrangements once in place”.

The report to full council, due to be debated next week, states the council’s existing lack of capacity will “impact on the council’s ability to move forward with the necessary urgency” and, as a result, £25,000 has been set outside to employ outside expertise.

In setting out the objections to other options, the report notes that a boundary review would be unlikely to be completed before elections in May 2015, as recommended by the LGA, and argues that a large council tax increase was a short term solution which would be unlikely to win the support of the electorate in a referendum.

A business case for the move to commissioning is to be drawn up “as soon as possible” with the council’s own risk assessment making it clear that, if no action is taken, it is “possible” the council will be unable to balance next year’s budget. It also states it is “likely” ministers will identify West Somerset “as a failing authority and put intervention measures in place”.

Shared management arrangements with Taunton Deane BC and Sedgemoor DC were investigated in 2010, after an earlier report also questioned the viability of the council, but the proposals were abandoned in early 2011 partly because the cost savings were minimal. Other shared service ventures were pursued, however.

Ministerial advice

The West Somerset papers, which set out in detail the pros and cons of the options available ahead of a full council meeting to be held next week, also reveal that Mr Lewis’ recent advice contradicted advice given by his predecessor Bob Neill.

At a December 2011 meeting with Bob Neill “the advice given at the time was to seek local support for a council tax increase that was above the national threshold or seek a merger with a neighbouring council through the Boundary Commission”, according to West Somerset.

However, a Department for Communities & Local Government spokesman disputed this suggestion.

“It is wrong to suggest government has changed its views. In December the local government minister [Bob Neill] made no proposals for boundary review, he raised concerns over possible council tax increase specifically that government could not countenance large increases and said it would be supportive of a shared service approach,” the spokesman said.

“The important thing is that West Somerset is looking to ensure that they have a sustainable approach to the financing of their council and should be actively looking at the scope for joint working to make sensible savings.”

The report also said the view of the LGA had “seemingly changed” since its report said a boundary review would be necessary in the long term. A spokesman for the LGA said it stood by the advice given in October based on information available at the time, but that it supported West Somerset in pursuing alternative options following discussions with other parties.

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READERS’ COMMENTS (1)

Roger | 8-Dec-2012 12:36 pm
This council is being led down the garden path by this minister, for reasons I cannot currently fathom.
It may be that he is following the Pickles plan of decide and conquer when it comes to this government’s wish to see local government reduced to no more than a parochial puppet of central government. This would also align with this government’s obsession with everything private. Conning this council into becoming no more than a front for a totally outsourced solution, that can then be touted around as the way forward for all councils, is also a possible goal.
Can somebody please explain to me what the role of the elected member is in an organisation where everything is totally contracted out and therefore offers little or no flexibility without throwing more money at the issue? Every complaint would elicit the same answer, sorry, it’s in the contract. I suppose they would only ever need to turn up for the quarterly performance reviews, followed by the annual contract review.

Peers champion ‘graph of doom’ prediction in Lords debate

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Copied from Local Government Chronicle
3 December, 2012 | By Keith Cooper

The government’s effort to discredit local government predictions of a looming social care funding crisis have failed to convince Labour and Liberal Democrat members of the House of Lords.

Peers debating the future of social care in the upper chamber this week pointed repeatedly to the now-famous “Barnet Graph of Doom” which shows that council budgets could soon be eaten up entirely by an inexorable increase in adult social care.

Senior civil servants dispatched to the Communities and Local Government had this month dismissed this prediction as overly ‘apocalyptic’ and too ‘pessimistic’.

But Baroness Barker (Lib Dem) told peers it was “understandable that people talk in apocalyptic terms about social care”.

“The Barnet graph of doom says it all. I have to say that the LGA laid it on by doing exactly what I would have done in the circumstances, which is to pick the very worst case.”

Lord Lipsey (Lab) also pointed to the north London borough’s graphic portrayal of the alleged impending social care crisis. “[The Barnet Graph of Doom] shows what the council expects to spend on services and, on another line, what it expects to be allowed to spend in total.

“By 2030, spending on social services alone, the bulk of that on old people, exceeds the total budget,” he added. “Either no bins will be emptied in Barnet…there will be no libraries or parks- no town hall even- or there will be further big cuts for old people.”

Lord Warner (Lab), a member of the Dilnot commission, agreed with Lord Lipsey’s characterisation of social care funding. “This will mean that big cities in particular lose their civic services around arts, leisure, and other things which make for a civilised society as their authorities concentrate on social care and child protection.”

Earle Howe (Con), parlimentary under-secretary of state Department of Health, challenged the “story of cuts” portrayed by his fellow peers.

“We remain firmly of the view that the funding we have provided is enough to allow authorities to maintain access to services and to provide good-quality care. Independent research from the King’s Fund corroborates this.”

“This is not the story of cuts as some critics have made out, and there is only limited evidence of the impact on services or on users.”

Baroness Pitkeathley (Lab) and vice president of Carers UK, who opened the debat sais she found it hard to recognise “the picture of local services” painted by Lord Howe.

Cut until only the tip of the iceberg remains – surprise! it sinks

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Not sure if the first paragraph of this article is ambiguous by accident or design – I can’t figure out who, or what the ‘they’ is. I hope it means the ministers who need the reality check, because I can assure you that councils don’t need any help realising how desperate things are set to become.

Acknowledgement to Ruth Keeling of Local Government Chronicle

Ministers have been warned that popular council services could be lost forever unless they take a “realistic review” of what local government does and how it is funded.

Publishing the results of the first serious attempt to model the funding outlook for councils over the next spending review period, the LGA issued a bleak forecast of a growing multi-billion pound shortfall between the demand for services over the next decade and the resources available to fund them.

The report accepts that cuts in the next spending review could be equal to the 28% reduction in funding seen in this spending period as the government continues to tackle the budget deficit.

Using “optimistic” assumptions of councils’ other income streams as well as demand for services, the association says the funding shortfall is set to reach £16.5bn a year by 2019-20.

That annual funding gap represents a 29% shortfall across all services, but is calculated to rise to 66% if social care and waste collection are fully funded.

Similar protection for capital financing and concessionary travel fares would result in a 90% funding shortfall for other services.

Polling conducted by YouGov this month suggested two such services – libraries and leisure facilities – were the most popular with the public, with 39% and 27% of adults respectively claiming to have recently used them, compared with 11% who said elderly care services.

LGA chairman Sir Merrick Cockell (Con) said: “By the end of the decade, councils may be forced to wind down some of the most popular services unless urgent action is taken to address the crisis in adult social care funding.”

At the heart of the funding crisis is the rising cost of such care, which the LGA predicts will equal almost half of all spending by the end of the decade. It warned that its estimates were “extremely conservative”, with some councils “modelling social care demand growing at twice the rate of our assumptions”.

The document, released at the LGA conference on Tuesday, represents the organisation’s opening gambit as the Treasury and the Department for Communities and Local Government begin to plan for the next spending review period.

It will also raise images of the BBC documentary, The Street That Cut Everything, where residents attempted to do without council services entirely.

As well as calling for reform for social care funding and the repealing of some of the 1,300 statutory duties to which councils are subject, the LGA has called for the joint working being tested in the Community budget pilots and the troubled families programme to be implemented more widely.

Solace’s policy and communications director Graeme McDonald said the report painted a “bleak picture” and warned the squeeze on highways, planning and economic development would make economic growth even more difficult.

He warned that the funding gap would open up more quickly in different areas of the country. “There is a diversity of crisis, but crisis it is,” he said.

Stephen Hughes, chief executive of Birmingham City Council, said ministers had to “express a view on what is more or less important”. He added: “We have got to have a proper conversation about priorities.”

The LGA report made it clear that, with central services accounting for just £3bn a year, the challenge could not be met simply through efficiency savings.

However, local government minister Bob Neill continued to call for savings. “Councils must make savings by sharing back offices, getting more for less from the £60bn a year procurement budget, using their £10bn of reserves, tackling the £2bn of local fraud, or reducing in-house management costs,” he said.

LGA assumptions
Council tax frozen until 2014-15 and then growing by 2% per year, although the LGA notes this “may be optimistic” and council tax could rise by less

Business rate income to grow at 3.5%, in line with Office for Budget Responsibility forecasts

Central share of Business Rates to be returned to local government in 2013-14 and 2014-15 and grants to be allocated in line with total funding set in 2010 spending review

Total funding beyond 2014-15 to be reduced by £17.6bn by 2020, “broadly similar” to reductions in 2010 spending review

Reserves to be drawn down through to 2013-14 but then rebuilt in case of volatility in business rate income

Efficiency savings of 2% per year tapering to 1% per year by end of period